The two loss-making companies have been hurt by weak demand in a sector dominated by bigger rivals Intel and Samsung Electronics Co. They face a combined net loss of 99 billion yen ($1.14 billion) this year.

The European Commission, competition watchdog of the 27-country European Union, said the transaction would not impede competition in Europe and the new company would continue to face effective competitors.

The proposed merger would not give rise to competition concerns in the markets for microcontrollers, SRAM, LCD drivers and other types of semiconductors, the EU executive said in a statement.

NEC Electronics will absorb Renesas after raising a total of 200 billion yen from their parent firms.

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Targeted Victory, a Washignton D.C. communications firm founded by a former digital strategist for Mitt Romney, is raking in money from Saudi Arabia to write a smattering of paid social media content. The agency was paid over $1 million by the Saudi embassy.